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EMBRAER ANNOUNCES ITS LONG-TERM MARKET OUTLOOK

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São José dos Campos, November 15, 2007 - During the 8th Embraer Day held November 13 and 14 in São José dos Campos, Brazil, Embraer (NYSE: ERJ; BOVESPA: EMBR3) presented its 20-year forecast for world demand of 30 to 120-seat commercial jets, as well as its ten-year forecast for the executive aviation market. At the same event, Embraer announced its commercial and executive jet delivery forecast for 2008 and 2009.

Long-Term Market Outlook

Commercial Aviation Market

Embraer projects that world air traffic demand will increase by 4.9% per year in 2008- 2027, with China presenting the highest growth rate (7.5% per year). Latin America, Middle East, Asia Pacific, Russia/CIS and Africa will grow around 5.5%, and mature markets, such as North America and Europe, around 4%.

Embraer foresees a global demand for 7,450 jets in the 30 to 120-seat capacity segment over the next 20 years, resulting in a total market value estimated at US$235 billion. The Company projects that 3,150 aircraft will be delivered in 2008-2017, with the remaining 4,300 units to be delivered in 2018-2027, as presented below:

​Market Segment (Seats)

2008-2017​

​2018-2027

​2008-2027

​30-60

​275

​825

​1,100

​61-90

​1,075

​1,525

​2,600

​91-120

​1,800

​1,950

​3,750

​30-120

​3,150

​4,300

​7,450 Jets

The forecast indicates that the 30 to 60-seat capacity segment has reached maturity, but will remain the backbone of the USA and Europe hub feeding system and will support the regional aviation development in some other world regions, such as China and Russia/CIS.

The 61 to 120-seat aircraft will continue to help airlines to match capacity to market demand with improved service levels, through the right-sizing of low load factor narrow- body flights, the natural growth of 50-seat regional jets and the expansion into mid-sized markets.

Embraer believes that emissions are one of the important drivers for airline fleet decisions, tending to accelerate old/inefficient jets retirement in the short term and influence future aircraft design in the mid-long term. Around 30% of current 61 to 120- seat jets in service are more than 20 years old and shall be replaced in the coming years, resulting in substantial environmental and operational benefits.

Commercial jets deliveries forecast for the 30 to 120-seat segment by region (2008-2027)

​Region

​Total Deliveries

​Share

North America​

​3,330

​45%

​Europe

​1,350

​18%

​China

​730

​10%

​Latin America

​580

​8%

​Asia Pacific

​540

​7%

​Russia/CIS

​510

​7%

​Africa

​220

​3%

​Middle East

​190

​2%

​Total (2008-2027)

​7,450

​100%

The full report for the 2008-2027 Embraer Market Outlook will be available online by January 2008 at www.embraer.com/outlook.

Executive Aviation Market

Embraer forecasts a demand for 13,150 business jets over the next decade, valued at approximately US$ 201 billion. The new air taxi market may add yet another 3,500 to 4,400 aircraft to the Very Light Jet segment.

Embraer entered the Very Light and Light Jet segments with the launch of the clean-sheet design Phenom jets (the Phenom 100 and Phenom 300) in May 2005. The Company introduced the Lineage 1000, an ultra-large executive jet based on the EMBRAER 190 commercial jet platform, in May 2006.

The first Phenom 100’s maiden flight occurred on July 26th and began its test campaign, being joined by the second Phenom 100 upon its first flight on September 21st. The first metal cut of the Phenom 300 occurred late March and its sub-assembly began in mid- August.

The first Lineage 1000 made its first flight on October 26th, and will begin its interior completion still in the month of november.

The Company announced further enhancements to the Legacy 600, which continues to gain market share, reaching 13.6% in the super midsize segment.

This September, Embraer presented two new concepts in midsize and midlight executive jets under study. If launched, upon board approval, these clean-sheet design concepts will be positioned between the Phenom 300 and the Legacy 600 in the Company’s Executive Jets portfolio.

Business jets deliveries forecast by product segment (2008-2017)

​Segment

Total Deliveries​

Share​

​Very Light

​3,380

​26%

​Light

​2,810

​22%

​Midlight

​1,230

​9%

​Midsize

​1,550

​12%

​Super Midsize

​1,470

​11%

​Large

​1,480

​11%

​Ultra-Long Range

​920

​7%

​Ultra-Large

​310

2%

​Total (2008-2017)

​13,150

​100%

Embraer continues to invest heavily in its Executive Jets Customer Support. The Company broke ground for three new service centers in the United States, in Connecticut, Arizona and Florida. The authorized service center network was expanded with the addition of ABS Jets in the Czech Republic, and Hawker-Pacific in Asia. By 2008, 45 service centers will support Embraer’s Executive Jets fleet, seven of which are wholly- owned.

Announced under the joint-venture established with CAE for Phenom jets training, the first training simulator for the Phenom 100 jet will be placed in Dallas, TX, by mid-2008 to support the entrance into service of that model in the U.S. The European program will be based in the United Kingdom and will commence upon entry into service of the Phenom 100 in Europe, in the first quarter of 2009. Embraer is investing heavily in parts inventory and logistics and continues to enhance its special maintenance programs.

Embraer’s commitment to business aviation has continued to render significant results throughout this year. The Executive Jets division holds a firm order backlog of close to US$ 4 billion, significant increase from US$ 2 billion in 2006 and US$ 600 million in 2005. Firm orders for the Phenom 100 and Phenom 300 Very Light and Light Jets stand at close to 600 units.

Currently, there are 121 Legacy 600 executive jets operating in 22 countries. Embraer expects to deliver over 30 Legacy 600 jets in 2007 and 30 to 35 in 2008, up from 27 units in 2006, 20 in 2005 and 13 in 2004.

Serial production of the Phenom 100 will commence in the second semester of 2008, totaling 15-20 units for the year, being up to five aircraft dedicated to customer demonstration flights. In 2009, when deliveries of the Phenom 300 begin in the second semester, the production rate of the Phenom 100 and Phenom 300 is projected to reach 120-150 units combined.

Delivery of up to two Lineage 1000 jets is expected for the second semester of 2008, in its first production year. In 2009, four to six Lineage 1000 jets are planned to be delivered.

Delivery Forecast for 2008 and 2009

Embraer expects to delivery, in 2008, between 195 and 200 aircraft in the commercial aviation, executive aviation and defense and government (sate-owned airliners and government authority transportation) segments, and between 10 and 15 Phenom 100 that are not included in the estimate above, for the same period. For 2009, the Company estimates delivery of 195 to 200 aircraft, and between 120 to 150 Phenom 100 and Phenom 300 jets not included in the figures above, for the 2009 period.

Embraer (Empresa Brasileira de Aeronáutica S.A. - NYSE: ERJ; Bovespa: EMBR3) is the world’s largest manufacturer of commercial jets up to 120 seats, and one of Brazil's leading exporters. Embraer's headquarters are located in São José dos Campos, São Paulo, and it has offices, industrial operations and customer service facilities in Brazil, the United States, France, Portugal, China and Singapore. Founded in 1969, the Company designs, develops, manufactures and sells aircraft for the Commercial Aviation, Executive Aviation, and Defense and Government segments. The Company also provides after sales support and services to customers worldwide. On September 30, 2007, Embraer had a workforce of 23,770 employees and a firm order backlog of US$ 17.2 billion.

This document may contain projections, statements and estimates regarding circumstances or events yet to take place. Those projections and estimates are based largely on current expectations, forecasts on future events and financial tendencies that affect Embraer’s businesses. Those estimates are subject to risks, uncertainties and suppositions that include, among others: general economic, political and trade conditions in Brazil and in those markets where Embraer does business; expectations on industry trends; the Company’s investment plans; its capacity to develop and deliver products on the dates previously agreed upon, and existing and future governmental regulations. The words “believe”, “may”, “is able”, “will be able”, “intend”, “continue”, “anticipate”, “expect” and other similar terms are supposed to identify potentialities. Embraer does not feel compelled to publish updates nor to revise any estimates due to new information, future events or any other facts. In view of the inherent risks and uncertainties, such estimates, events and circumstances may not take place. The actual results can therefore differ substantially from those previously published as Embraer expectations..